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Tastyfreeze Company is a small producer of fruit-flavored frozen desserts. For many years, its products have had strong regional sales because of brand recognition; however, other companies have begun marketing similar products in the area, and price competition has become increasingly important. Dan OMara, the companys controller, is planning to implement a standard cost system for Tastyfreeze and has gathered considerable information from his coworkers about production and materials requirements for Tastyfreezes products. Dan believes that the use of standard costs will allow the company to improve cost control, make better pricing decisions, and enhance strategic management.

• Tastyfreeze purchases raspberries for $4 per quart. All other ingredients cost $3.70 per gallon.
• Direct labor is paid at the rate of $12 per hour.
• The total packaging cost (labor and materials) for the sherbet is $0.40 per quart.

Required:

1. Develop the standard cost for the direct cost components of a 10-gallon batch of raspberry sherbet. For each direct cost component, the standard cost should identify the following: (Do not round intermediate calculations. Round your answers to 2 decimal places.)

a. Standard quantity.

b. Standard rate (or price).

c. Standard cost per 10-gallon batch.

(a) Standard Quantity (b) Standard Rate ats. = Direct materials: Raspberries Other ingredients Direct labor: Sorting Blending Packaging (c) Standard cost per 10-gallon batch ( ats.) ats

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